Hong Kong Tramways has submitted an application to the government for a 13 percent increase in fares, citing financial difficulties amid Covid-19.

If approved, the first hike since July 2018 will see adult fares climb from HK$2.6 to HK$3, fares for those under 12 rise from HK$1.3 to HK$1.5 and fares for elderly people go up from HK$1.2 to HK$1.3 per ride.

In a paper submitted to Legco, the Transport and Housing Bureau said the company suffered a net loss of HK$3 million last year due to a drop in fare revenue and rising operating costs, and that Hong Kong Tramways considered the proposed fare increase vital to maintain sustainable operations as well as stable tram services.

"Even after taking into account subsidies under [Anti-Epidemic Fund] 6.0 and 2022 Employment Support Scheme, it is estimated that [Hong Kong Tramways] will barely reach a breakeven situation in 2022. Without these one-off subsidies, [Hong Kong Tramways] will have difficulty sustaining its business," the paper read.

The paper noted that the fifth wave of the pandemic has further lowered patronage, with the number of passengers in March down by half compared with pre-Covid levels.

The company said the pandemic prompted it to revise its application submitted in October, which proposed an adult fare of HK$2.9 and a children's fare of HK$1.4, HK$0.1 less than the current proposal.

The government will consult Legco and the Transport Advisory Committee before submitting recommendations to the Chief Executive in Council for consideration.